Abstract Excess amounts of cholesterol and bile acids are associated with metabolic diseases, such as atherosclerosis and cholestatic liver disease. The overall aim of this project is to understand how cholesterol and bile acid levels are regulated by an orphan nuclear receptor, small heterodimer partner (SHP), which is emerging as a critical regulator of hepatic metabolic pathways. Cholesterol conversion to bile acids represents a major route for elimination of cholesterol from the body, and cholesterol 7a hydroxylase (CYP7A1) plays a key role in this process. Increased bile acids repress transcription of CYP7A1 by activating the FXR/SHP nuclear receptor cascade and by activating kinase signaling and fibroblast growth factor 15 signaling pathways which may also involve SHP. We have demonstrated that SHP inhibits CYP7A1 transcription by coordinately recruiting chromatin modifying cofactors to the promoter after bile acid treatment, resulting in chromatin remodeling and gene repression. However, how SHP and its chromatin cofactors are assembled and recruited to the promoter and whether multiple bile acidactivated kinase signaling pathways affect these processes by modulating post-translational modifications of SHP remain unknown. In preliminary studies, we have obtained exciting new data supporting the hypothesis that bile acids not only induce SHP expression via FXR, but also increase the stability and activity of SHP by inhibiting proteasomal degradation and increasing sumoylation of SHP via upstream phosphorylation events. Further, we propose that both the stability and activity of SHP are also regulated by its ligands. To test these hypotheses, we will: 1) Define of the role of proteasomal degradation of SHP in bile acid signaling. 2) Investigate the role of SHP sumoylation in the regulation of SHP stability and activity. 3) Delineate how SHP activity is modulated by its potential ligands. Our studies to define how SHP activity is modulated by bile acids and its ligands will help us understand the mechanism of SHP action and may reveal molecular targets for treating metabolic and other diseases in which SHP plays a key role.